Insurance company to sue Lance Armstrong for millions in bonus prizes

By Ed Lavandera and Steve Almasy, CNN

Updated 11:19 AM ET, Thu February 7, 2013

Photos: Lance Armstrong's rise and fall28 photos

Lance Armstrong's rise and fall – After denying the allegations for years, cyclist Lance Armstrong admitted to using performance-enhancing drugs. As a result, he was stripped of his seven Tour de France titles and an Olympic bronze medal. Click through the gallery for a look at his life and career.

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Photos: Lance Armstrong's rise and fall28 photos

Lance Armstrong's rise and fall – Armstrong, 17, competes in the Jeep Triathlon Grand Prix in 1988. He became a professional triathlete at age 16 and joined the U.S. National Cycling Team two years later.

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Photos: Lance Armstrong's rise and fall28 photos

Lance Armstrong's rise and fall – Armstrong wins the 18th stage of the Tour de France in 1995. He finished the race for the first time that year, ending in 36th place.

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Photos: Lance Armstrong's rise and fall28 photos

Lance Armstrong's rise and fall – Armstrong rides at the Ikon Ride for the Roses to benefit the Lance Armstrong Foundation in May 1998. He established the foundation to benefit cancer research after he was diagnosed with testicular cancer in 1996. After treatment, he was declared cancer-free in February 1997.

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Photos: Lance Armstrong's rise and fall28 photos

Lance Armstrong's rise and fall – Armstrong leads his teammates during the final stage of the 1999 Tour de France.

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Photos: Lance Armstrong's rise and fall28 photos

Lance Armstrong's rise and fall – Armstrong takes his honor lap on the Champs-Élysées in Paris after winning the Tour de France for the first time in 1999.

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Lance Armstrong's rise and fall – After winning the 2000 Tour de France, Armstrong holds his son Luke on his shoulders.

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Lance Armstrong's rise and fall – Armstrong rides during the 18th stage of the 2001 Tour de France. He won the tour that year for the third consecutive time.

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Lance Armstrong's rise and fall – Armstrong celebrates winning the 10th stage of the Tour de France in 2001.

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Lance Armstrong's rise and fall – After winning the 2001 Tour de France, Armstrong presents President George W. Bush with a U.S. Postal Service yellow jersey and a replica of the bike he used to win the race.

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Lance Armstrong's rise and fall – Armstrong celebrates on the podium after winning the Tour de France by 61 seconds in 2003.

Lance Armstrong's rise and fall – After his sixth consecutive Tour de France win, Armstrong attends a celebration in his honor in front of the Texas State Capitol in Austin.

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Lance Armstrong's rise and fall – Armstrong arrives at the 2005 American Music Awards in Los Angeles with then-fiancee Sheryl Crow. The couple never made it down the aisle, splitting up the following year.

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Lance Armstrong's rise and fall – Armstrong holds up a paper displaying the number seven at the start of the Tour de France in 2005. He went on to win his seventh consecutive Tour de France.

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Lance Armstrong's rise and fall – Armstrong testifies during a Senate hearing in 2008 on Capitol Hill. The hearing focused on finding a cure for cancer in the 21st century.

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Lance Armstrong's rise and fall – In 2009, Armstrong suffered a broken collarbone after falling during a race in Spain.

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Lance Armstrong's rise and fall – Young Armstrong fans write messages on the ground ahead of the 2009 Tour de France. He came in third place that year.

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Lance Armstrong's rise and fall – Armstrong launches the three-day Livestrong Global Cancer Summit in 2009 in Dublin, Ireland. The event was organized by his foundation.

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Lance Armstrong's rise and fall – In May 2010, Armstrong crashes during the Amgen Tour of California. That same day, he denied allegations of doping made by former teammate Floyd Landis.

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Lance Armstrong's rise and fall – Armstrong looks back as he rides during the 2010 Tour de France.

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Lance Armstrong's rise and fall – Armstrong's son Luke; his twin daughters, Isabelle and Grace; and his 1-year-old son, Max, stand outside the Radio Shack team bus on a rest day during the 2010 Tour de France.

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Lance Armstrong's rise and fall – Armstrong finished 23rd in the 2010 Tour de France. He announced his retirement from the world of professional cycling in February 2011. He said he wanted to devote more time to his family and the fight against cancer.

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Lance Armstrong's rise and fall – The frame of Armstrong's bike is engraved with the names of his four children at the time and the Spanish word for five, "cinco." His fifth child, Olivia, was born in October 2010.

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Lance Armstrong's rise and fall – Armstrong competes in the 70.3 Ironman Triathlon in Panama City, Florida, in February 2012. He went on to claim two Half Ironman triathlon titles by June of that year.

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Lance Armstrong's rise and fall – Armstrong addresses participants at the Livestrong Challenge Ride on October 21, 2012, days after he stepped down as chairman of his Livestrong cancer charity.

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Lance Armstrong's rise and fall – International Cycling Union President Pat McQuaid announces the decision to strip Armstrong of his seven Tour de France wins and ban him from the tournament for life on October 22, 2012. "Lance Armstrong has no place in cycling," he said.

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Lance Armstrong's rise and fall – In January 2013, Armstrong speaks with Oprah Winfrey about the controversy surrounding his cycling career. He admitted, unequivocally and for the first time, that he used performance-enhancing drugs while competing.

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Story highlights

U.S. Anti-Doping Agency gives Armstrong more time to consider request to testify

SCA paid Lance Armstrong $12 million in prizes for winning several Tours de France

The sports insurance company that paid Lance Armstrong more than $10 million in bonuses plans to file a lawsuit to recover its money, an attorney for SCA Promotions told CNN on Wednesday.

Jeffrey Tillotson said SCA has already asked the disgraced former cycling champ for the money back.

An attorney for Armstrong said the claim has no merit.

"We made our demand for the return of the money we paid him for winning the Tour de France races where the titles were stripped," Tillotson told CNN's Ashleigh Banfield. "Mr. Armstrong and his legal team have not complied with that demand."

Tillotson said the suit, which has not been filed yet, will ask for the return of $12 million in bonus money paid for wins from 2002 to 2005 and for millions in legal costs and interest.

Armstrong sued SCA after it delayed his 2005 bonus payment and raised questions about allegations involving his use of performance-enhancing drugs. Armstrong testified under oath in that case that he had never doped. SCA settled with Armstrong a year later.

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"But both he and his lawyers almost taunted us and said if we are ever stripped of those titles, we will give you the money back," Tillotson said Wednesday. "We will simply ask him to finally live up to his word and give that money back."

Armstrong's attorney, Mark Fabiani, argues the insurance company has no right to the money because of the 2006 settlement agreement, which reads in part, "no party may challenge, appeal or attempt to set aside the arbitration award."

Fabiani says, "It is clear as day the insurance company has zero right to reopen the matter."

"He lied about virtually everything. And we are going to ask the arbitration panel that heard that testimony to punish him and hold him accountable for it," the attorney said.

A year ago, federal prosecutors told Armstrong that the two-year investigation into his use of performance enhancing drugs was over. No charges would be filed.

"We made a decision on that case a little over a year ago. Obviously, we've been well aware of the statements that have been made by Mr. Armstrong in other media reports. That has not changed my view at this time," United States Attorney Andre Birotte said this week.

Now it appears that federal investigators may not be ready to give up just yet.

A spokesperson for the Food and Drug Administration, which has been investigating Armstrong, told CNN it's "an ongoing matter."

Armstrong first admitted the use of performance enhancing drugs and blood doping during a January television interview with Oprah Winfrey, ending years of denial that he cheated during the prime years of his cycling career.

He was stripped of his Tour de France titles by international cycling's governing body in October after a damning report by the U.S. Anti-Doping Agency accused him and his team of "the most sophisticated, professionalized and successful doping program" in cycling history.

The agency said Wednesday that it has been in talks with Armstrong about having him help clean up the sport.

Chief executive officer Travis Tygart said Armstrong was granted a two-week extension to Wednesday's deadline to tell the USADA whether he will help or not.

USADA has banned Armstrong, 41, for life but did say the ban could be reduced to eight years if he cooperated under oath with investigators.

Armstrong's cycling career is long over, but he competed in and won several triathlons in 2012.

Armstrong told Cycling News in late January that he thought a truth and reconciliation commission, run by the World Anti-Doping Agency, was the "only way forward."

At the time he said WADA should run the probe, not the USADA, "This is a global sport, not an American one. One thing I'd add, the (International Cycling Union) has no place at the table."

Since Lance Armstrong's interview with Winfrey, the disgraced cyclist has disappeared from public view.

Once prolific on Twitter, he hasn't tweeted in nearly a month, and his profile page now ends with these words of wisdom: "Met patience in 1996 but only now am I getting to know and appreciate her."